TeenAnalyst.com

Fund of Funds
Term category: Mutual Funds
In 10 words or less:  A mutual fund or hedge fund hat invests in other funds.

Definition: This is a mutual fund or hedge fund that invests in other funds rather than in individual securities.

Advice: Fund of funds are thought to be attractive because they offer greater diversification and can select the best mutual funds to invest in.

However, it's important to realize that you may be paying twice as much in expenses (the individual mutual funds and the fund of funds both likely charge fees).

 

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